In arguments over business and the economy, you often hear that the job of corporations is to “maximize shareholder value.”

People use this phrase to justify all kinds of things that are ethically ambiguous (e.g. polluting as much as possible up to the legal limit), or seen as distasteful to some (e.g. layoffs).

But, is that the right goal of a corporation? Is it even a good benchmark of a successful corporation? And, does it even work anymore?

In order to understand if “maximizing shareholder value” makes sense as a primary business objective, it’s important to understand the historical forces that led to this goal for corporations being broadly adopted. This concept has not been fixed as the sole, or even primary, goal of corporations, but instead was created in response to a specific set of circumstances.

Basically, U.S. corporations performed relatively poorly in the 1970s because of their huge size and inefficiencies (it’s difficult for lumbering giants to find and invest in good ideas). This, combined with increased competition from smaller (and therefore more efficient) Japanese firms caused U.S. firms to profit even less.

The primary operating mantra for U.S. corporations was “reinvest and retain,” meaning that corporations should use their profits to 1) reinvest in new, productive inventions, and 2) retain both their earnings and their talent to build capacity to take advantage of those productive inventions.

To our modern business eyes, this might seem foolish, but you should remember that this strategy had worked basically since the start of the industrial revolution.

So, in the 1980s, the ~100 year objective of “reinvest and retain” wasn’t working anymore. Smaller, more nimble firms were eating away at larger, slower competitors.

In addition, the 1980s saw the rise of large institutional investors – basically guys who just aggregated capital and pushed it around. These started out being guys who aggregated retirement savings for hundreds of thousands of workers, and therefore had big dollars to push into productive companies.

Large institutional investors did not care about ongoing R&D, or about retaining quality talent. And, this model was not working very well at the time. So, “maximize shareholder return” was born out of this primordial business ooze. It aligned big capital with big business in order to produce stellar returns for both.

Of course, this begs the question: does “maximize shareholder value” work as a business objective today?

I would argue that it doesn’t because:1. Large organizations are much leaner now (after 30 years of rightsizing and justifying every head against a P&L), and feedback loops on productivity of R&D and internal investments are much more equal across all sizes of companies2. The large institutional investors have gotten so large as to overwhelm any (and every) capital market, and therefore, every company within the market. Currency traders can crash economies. Banks control both commodities traders and commodities storage and transport facilities, allowing them to manipulate commodities markets. And 70+% of market trades are made by algorithm, introducing manipulation through HFT (yes, yes, as well as liquidity, because when you want to sell a stock, you HAVE to do it RIGHT THIS SECOND so very often).3. We have learned to manipulate stock prices (the most common and simplest proxy for shareholder value) with a host of tricks that have nothing to do with value creation. I’m talking about things like splits and buybacks; special dividends; shifting borrowing costs and bond holdings; offshoring tax liabilities with no way of repatriation of profits sans tax (unless – or until? – large companies strongarm the federal government into a repatriation tax holiday); the creation of shell corporations; etc. These things do not add to the productive economy, but do line the wallets of bettors and financial manipulators.

I would posit that a return to “retain and reinvest” as a main objective of corporations would be good for the companies, their employees, tax rolls, the broader business climate, and society at large.

In fact, the smartest businesses that I know of are using this model to grow very, very profitable companies (albeit, probably without saying it in this way).

Look at the organizing structure and operating model of these very, very innovative, and very, very profitable companies:

Google: Two classes of shares, with minimal voting rights of money investors. No dividends. Basically, the board cannot be controlled and the huge profitability of search ads can’t escape Google’s walls to be frittered away by dumb Wall Street people. Instead, it’s tightly held by the business leaders, who reinvest in a whole host of productive innovations.

Facebook: Two classes of shares, and 57% of the voting interest held in one person – Mark Zuckerberg. He gets to take risks with money from big institutional investors without being beholden to anyone for the performance of the company. Hence, you get huge moves like the $19B acquisition of WhatsApp, even when P/E is over 100.

Berkshire Hathaway: Has never split stock. Has never paid a dividend due to tax inefficiencies of doing so. Added a second class of stock to be more affordable to newer investors, but with reduced voting rights. Buys to hold literally forever, with no plans to ever sell a company. Keeps management in place to continue growing their business units. Takes FCF from business units into a BDC structure to mount the next acquisition. This is the definition of “retain and reinvest.”

I didn’t have many pre-conceived notions about what the event would hold, because I know Chris’s audience is diverse – travel hackers, nomads, bloggers, startup people, musicians, and basically anyone who is interested in living a life of non-conformity. So, there is no telling where things will go.

And, as a result, it felt like a little taste of many things. Enough to whet your whistle, and hopefully stir something in you to make you want to go deeper on your own.

Brene Brown was outstanding – I was not familiar with her work before the conference, and am now an instant fan. Her work focuses on authenticity, shame, empathy, and vulnerability. Pretty woo-woo stuff, except she is a Ph.D. researcher on these topics, and has done a ton of quant work proving out the concepts she talks through.

One key takeaway from Brene was that you can’t experience joy without being vulnerable – we must risk something in order to allow someone else to respond to us in an affirming way. What occurred to me was that gay people who have gone through the process of coming out understand this concept – and the vulnerability and exposure of coming out is exactly what makes gay people able to live authentic lives in other ways. Using this very fundamental reality about yourself as an opportunity for vulnerability is pretty empowering.

The other stellar speaker was Cal Newport, who talked about how to “Follow Your Passion” is terrible advice. Instead, he offered up another model that is much more productive, leads to better overall outcomes, and is actually proven to be successful: create a skill that is rare and useful, then use that skill to trade for the values that are important to you.

The model works this way: by developing a marketable skill through the process of mastery, you can use the scarcity of what you offer as leverage for the things you really want. Of course, that means you need to be accurate in your assessment of what skills will be useful and rare, and how to master them. It also means you have to understand what you really want. But it offers myriad ways to a path of success.

While many of the sessions were long on the “why” to do something, and short on the “how,” the attendees made the experience worthwhile. Being around interesting, passionate, motivated people was motivating in and of itself. I’m looking forward to next year already.

Google has raised a lot of digital hackles with its new policy requiring real names for Google+. Cory Doctorow says that real identities are bad because they make it easy to sell us to advertisers. danah boyd goes further, saying that the policy is an abuse of power, because it may compromise users’ safety.

But they vastly understate the case, and ask for the wrong solution.

The hugeness of Google’s error is in misunderstanding the basic human need for a flexible framework for identity creation. People change and evolve, and throughout the entirety of human history, we have been able to shed old versions of ourselves, and construct new identities. This is so universally true as to be a cliche. How many films have this arc as the first act: A stranger comes to town. What is the mysterious secret he hides? What did he run away from?

Our identities are complicated. In fact, the need for multiple identities only accelerates in today’s internet culture. Digital natives understand the notion of curation so much so that they curate their own existence on social networks. Julia Allison and iJustine are extreme examples of this phenomena, but it happens all over every Friday night when young people spend more time shooting photos of themselves to upload to Facebook to show how great a time they’re having, instead of, you know, actually having a great time.

The act of identity creation happens on the social network, through the curation process. Not by the things that are really happening to the person.

In this context, we are becoming more like celebrities. We manage our personas by curating which pictures get tagged on Facebook with our identity (hint: only the ones where we look good). We portray the most interesting aspects of our lives through status updates (“I found a dollar on the street!” gets 27 Likes not because it’s important, but because it’s interesting.) We understand that parts of our personalities are most appropriate for different audiences.

The rise of celebrity culture is actually an attempt to create shared experiences for a large, fragmented society. Smaller countries have smaller celebrities in the U.S. (Incidentally, that’s why Kylie Minogue had to redeem her post-Locomotion career in the U.S. with the wonderful “Can’t Get You Out Of My Head;” and why David Beckham left a hugely successful career in the U.K. to bring soccer to a country that would rather watching boring old baseball than see a low-scoring soccer game.)

So, as our own social circles continue to grow, we become more like celebrities ourselves. So, we can learn something from celebrities about the importance of alternate identities. Increasingly, artists have created alter egos for themselves to make space for a different or new part of their personality to emerge. As they get boxed in by the expectations of their fans, they need to create an outlet that allows them to risk something by creating work that is outside of their traditional oeuvre.

Madonna took the persona of Dita when she released Erotica and her Sex book in order to explore sexuality in a deeper way than she could as the Material Girl.

Sean Combs became the rapper Puff Daddy, then P. Diddy when he needed to refresh his stale 90s image. Instead of creating a new personality, he just kept beating that dead horse, and when it stopped working, he dropped the “P” and just became Diddy. But, for his serious menswear clothing line, he uses the moniker Sean John.

Marshall Mathers became Eminem, and when there was still too much darkness and bile, he created the persona of Slim Shady.

The most extreme example is Nicki Minaj, who has taken the notion of alter egos to the insanely logical extreme. She has only released one album, but has no less than eight distinct personas:

1. Onika Tanya Maraj is her given name

2. Cookie is the first identity she created to escape her troubled home life

3. Harajuku Barbie is the playful Minaj

4. Nicki Minaj is her primary performing identity

5. Roman Zolanski is the hard charging, angry brute

6. Martha Zolanski is Roman’s mother

7. Nicki Theresa is a Mother Theresa-inspired saint

8. Rosa is her Spanish moniker

The value of multiple identities to these artists is indisputable. One of the most extreme examples is Roman’s Revenge, the 2010 Nicki Minaj and Eminem duet. Both rappers spend the entire song spewing hate-filled lyrics at their fans. This is not a song that a musician would want to present to the public as part of their late night talk show personality. Without alternate identities, this song could not exist. And while it’s a tough song to listen to, the world is a better place for having the song in it.

One single name will never be able to contain all of the aspects of any individual person, in all their complicated, contradictory glory. That’s why Google+ will ultimately fail in its attempts to create an “identity service” with their real name policy.

Quora also has a real names policy. But it never came under serious scrutiny because it was always clear about what kind of community it was: a serious-sounding, wonky intellectual place where deep-ish knowledge, packaged well, is appreciated. It’s a very specific niche, and it is more interested in keeping quality high than getting lots of users to interact.

Google+ wants us to give it everything, which means that we will end up giving it nothing of value. By requiring real names, Google+ is sending clear signals that it wants to be a specific type of community: the kind where people share cat videos and links about current events that can inform Google’s own search rankings. Paradoxically, even this banality will still create a huge amount of value for Google, because of how bad computers are at truly understanding people. Google’s ability to sell advertising will still grow tremendously, even from this crappy level of information.

Critics of the Real Name policy want Google to change its mind and see the error of its ways. That is the wrong solution.

The right solution, of course, is to do nothing. Allow Google+ exactly the kind of community they ask for: the one where you use your real identity, but in return, only share a certain, specific part of yourself: the part that you don’t mind being indexed by Google’s servers and made available to the entire world. In other words, the most boring, unimportant, and universal version of yourself.

Social login is a simple concept, with profound implications. When a user logins into any website using an existing online identity, there is immediate value for both the the user and the website.

For users, the ease of logging in without filling out a long profile form and the convenience of not needing to remember passwords is a clear benefit. For websites, among the many benefits is the information that users share offers an opportunity to make the site experience more relevant.

From a technical standpoint, the process of integrating Janrain Engage to enable social login into your site is very straightforward. Most of the effort in the integration will be around determining the best possible user experience for your community.

Defining Reasons to Register

First, and most important, you must clearly define why a user would register on your site in the first place. This critical step is often the most overlooked. Your users are rational economic actors, and as such, will evaluate the trade-offs of every exchange. They will weigh what they are giving up (personal information) for what they are receiving in return. Even when there is no money involved, your users still need to find more value in what they receive from registration, than the personal information they are giving up.

There are a number of ways to provide value for a registration. Here are some ideas to start you off:

Premium content: Some websites keep high-value content behind a registration wall. There are many ways to build value into content, like creating long-form reports, high-value videos, or early access to regular content. For content-driven sites, this is the easiest way to build value for registered users.

Contests and promotions: Short-term contests with valuable prizes are a great way to build registrations. Remember that the prizes don’t necessarily have to be expensive, but they must be valuable for your audience. An in-person meeting with a famous singer doesn’t cost anything, but has a huge value to fans.

Community: Access to message boards, comments, or your branded social network are all valuable add-ons to your users’ experience – and are sometimes the primary experience of your website. In those cases, it’s natural to register in order to contribute.

The type of experiences you put behind a registration will dictate the type of users who will register. Your most loyal fans will want access to premium content; more casual users may be interested in a contest (depending on the prize). Consider your goals in relation to the 1/9/90 rule: in general, 1% of users create content; 9% will comment on those creations; and 90% will be passive readers.

Registration Process

Next, consider the actual experience of registering on your site. Where should the registration button be placed? Are there events that launch a registration flow automatically, like when a user clicks “Submit” after writing a comment. The launch experience will determine how likely a user is to abandon their registration. Make sure the benefits of registering are clearly defined right away in that process.

Finally, consider how much work it is for your user to complete their registration. You want the process to be as seamless as possible. This is your opportunity to leverage all of the data from a social login. If possible, do not require your users to create a separate “Display Name.” If there are certain fields that you require, like email address, only offer identity providers that provide that data to you.

If you must collect additional fields, they can be automatically pre-populated using the social data you have collected. Any additional information you require could cause your users to abandon the registration process. So, it’s crucial to only require items that are actually required. Don’t lose the good data they are providing by harassing them for one more item as it will cause drop off.

So far, we’ve discussed the whys and hows of user registration. Next week, I’ll talk more about how to make advanced registration and profiles more useful for your users, and for your business.

Fundamentally, people are attracted to social technologies because they like sharing their lives and experiences with friends. In fact, the ability to share is one reason that Jeremiah Owyang has said that email was the first social network. Before Friendster or Tribes, people emailed cute cat videos to each other.

That desire to connect and share with others is the driving user need for Janrain’s Invite Friends functionality. Invite Friends is different than Social Sharing. Where a social share event is a broadcast message to all social connections, Invite Friends allows the user to send a targeted message to selected friends. It’s the difference between a “come one, come all” poster to the Friday night party, and a party invitation delivered through the mail. More targeted, more personal.

This functionality can be used for a number of purposes, like sharing a deal or offer, telling friends about an achievement, targeting a sensitive message to the best connections in the user’s network, or asking a friend to join the user in a new social experience.

Janrain offers Invite Friends functionality for Facebook, MySpace, Twitter, Google, Yahoo, and Windows Live (Hotmail). The end result in social networks is a network message (e.g. a Facebook Message or Twitter Direct Message) from the user to their friend; for Google, Yahoo and Windows, the end result is an email from the user to their contact’s email.

The Invite Friends functionality is very easy to implement. It’s based on Janrain’s Contacts API. In order to implement this functionality, you must first ensure that you have asked for the correct permissions from the user. In Facebook, the user has to authorize your site to access their contacts. In email providers, the user authorizes access to their email address book.

The contact list that is returned from Janrain is normalized and available in XML or JSON. If the user has connected multiple identities, contacts from multiple networks can be displayed. Now, you can render those contacts in the way that makes the most sense for your users.

There are a two common options for rendering contact lists.

You can queue them up to be auto-populated from a keystroke trigger, like Gmail:

Or you can import photos and allow users to check which contacts they want to communicate with:

Make sure to allow the user to select all or none of their contacts easily, in addition to toggling a selection for an individual contact easily. Also note that Janrain won’t return any information from a Facebook user’s friend that the friend has not authorized for the user to access.

Another way to leverage your user’s social graph is through a Refer a Friend experience. This is a highly targeted way to maintain the exclusivity of an experience, by limiting access to social referrals. You can enhance the velvet rope feeling by limiting the number of friends that can be referred.

Inviting friends with a targeted message is important functionality to consider for higher value, or more sensitive experiences that don’t make sense for users to broadcast to their entire network. Not surprisingly, they are also more effective marketing messages than anything you could send directly from the brand. Open rates on messages and emails from known contactsare 43% higher than from email marketers, and transaction rates are 2.5 times higher.

Janrain has detailed documentation on using the Contacts API to start this process, and please contact us if you have any questions on how to build your own Invite Friends experience.

One of the most common use cases for Janrain Engage is to promote your website content on external social networks through the use of our social sharing functionality. Sharing has come a long way from constrained widgets. Janrain offers unmatched flexibility and tracking for social sharing – from simultaneous network broadcasts to sharing from a mobile device.

Fortunately, the process of implementing Janrain’s social sharing on your website is very straightforward. There are three main components that you have to define: the activity that triggers a sharing event, the content within the publish activity, and the links back to your existing analytics package for return visitor tracking. Let’s look at them individually.

The Activity Event

The process of a social share starts with a user activity. Most of the time, the activity will be a click event, on a sharing icon, button, or favicon. But, a triggered share can be prompted from any event. Some possible sharing events include:

Reaching the end of an article: when a user has read an entire article, they are more likely to share it than a user who read just the first paragraph. You can implement a sharing trigger once the user scrolls to the bottom of a page. Here, Kodak allows users to share their projects.

Commenting on a piece of content: when a user comments on a piece of content, the publication of that comment can trigger a recommended share event. In this case, the user is not done with the comment flow until they decide whether they want to share the comment or not. Here, the Bakersfield Californian allows users to share their comments on articles.

Completing a sequence of events: a user may want to share when they have accomplished something on your site. Whether its getting to the end of a checkout process, viewing a video series, or interacting with advertiser elements on your site, every unique experience is potentially a shareable experience. Here, AMC allows users to choose which suspect is the killer on the TV show “The Killing.”

The Publish Event

Publishing a social share is the act of submitting that shared content to the social networks where the user has connected. Janrain’s sharing allows the user to post to multiple networks simultaneously, which increases overall sharing, as users link to multiple networks with one publish event. In addition, Janrain allows you to retain some control over brand perception by allowing users to publish immediately, or to put social shares into a moderation queue, and publish them later.

In order to finalize a publish event, you have to determine a few things about what defaults the user should share. You’ll need to determine what the title and description of the event that the user shares should say. Most commonly, those will be driven by the page-level information you are already using, and pulled directly from the HTML on page. Of course, custom messaging is also possible. So, your content strategist should be involved in how social content is messaged for maximum clickthrough and SEO benefits.

We also recommend that you prompt your users with a message to share to their network. Of course, the user will have the ability to customize the message they send out to their network, but this is a case where smart default copy can influence the tone and color of how your content is received by the user’s social graph. Default copy can be static or dynamic based on the page content or template, and could be the page or article title, and can also include an action from the user, like “I love…” or “I just read…” This prompts the user to think about the context they want to provide for their friends and contacts.

The Analytics Setup

Of course, the goal of users sharing your content is to drive more traffic back to your site. You will want to ensure that you are accurately tracking the return traffic from a sharing event.

Janrain’s social sharing works with any analytics package. First, you must establish the proper campaign tracking identifier to append to the shared URL. In general, you will want to track several components, such as Campaign Name, Referrer, and Source, R. Most websites define the Campaign Name as “SocialMedia,” Referrer as “SocialShare,” and Source as the share location (e.g. “Checkout” or “ArticleEnd”).

The campaign tracking append is embedded within the share trigger, as part of the URL that is shared. Simply place it at the end of the URL reference as a hard coded element in the share activity. That way, regardless of what specific page the user is on, the campaign tracking information will be automatically added.

We also recommend that you shorten the URL after campaign tracking identifiers are appended. Janrain provides easy URL shortening through our rpx.me service. Now, you’re all set to allow users to share content in a way that adds more user profiles and more social media analytics onto your site.

Janrain’s customers see an average of 13 return visitors for every link shared. With a well thought-out social sharing strategy, you can dramatically increase your site traffic from social media, and drive a more qualified referral visitor at the same time. Janrain’s strategic servicescan help you articulate the most valuable sharing experience for your users.

Over the past several years, I have seen a variety of organizations wrestle with the enormous implications of social media. Nothing less than the very DNA of the company must shift in order to take advantage of the power of your own customers.

Social sign on is, in fact, the core functionality that opens the corporate website to true social media experiences.

That’s why I’m excited to join the team at Janrain, as their digital marketing and social media strategist. Janrain has been the pioneer in social identity management for years. They understand better than anyone how crucial social identity management is because they have been focused on creating huge value for their clients by bridging the fluid, quicksand of social media fashions (since before My_____ was called MySpace) and real marketing challenges.

So far, most brands have just toyed with the idea of bringing social functionality into their websites, and those early experiments have not gone very far. But Janrain’s partners are different – they have a deep, institutional understanding of how social media is reshaping customer relationships, and therefore, marketing strategy. Janrain stands at the front door of creating social experiences, with critical technology for nearly every website.

Janrain Engage, their social sign on solution, makes it easy for digital marketing teams to integrate existing identity providers into their website. That means more sign ups, more sign ins, and more conversions. It means more opportunities to personalize messaging. It means a more relevant and useful site experience for every visitor.

And that’s just the start.

Janrain’s other products aggregate social profile data to feed into existing CRM systems, and create single sign on for website networks.

This is infrastructure that must just work - marketing teams need to focus on creating experiences, not on the plumbing. And Janrain has built the tools to take the pain out of creating social experiences.

I am incredibly proud of the Emerging Media practice I built at White Horse. The social media methodologies and the mobile marketing resources I created there will continue to move forward with a strong group of marketers, creatives, and problem solvers. And White Horse’s clients will build even more successful marketing programs than ever.

Thank you to everyone I worked with at White Horse. Your passion, commitment, vision, and downright grit got me to dig deeper than I ever have before.

And, I expect to dig even deeper still at Janrain. The solutions are real, and substantial. The biggest challenge now is seizing the fullness of the opportunity. Janrain is ready to deliver outstanding solutions to all of the marketers who can benefit from our technology – which is every website in existence. A tall order, to be sure. But that’s just how I like it.

If you’re trying to develop your geolocation marketing strategy, but don’t know where to begin, look no further than your social media strategy. These two components go hand in hand, and spending energy on geolocation without tight social integration will lead to a marketing program that’s dead on arrival.

White Horse recently conducted a survey of smartphone users to determine how geolocation apps like Foursquare and Gowalla were being used by consumers, and how marketers should integrate check-in functionality and location information to their marketing plan.

The results were clear: Facebook Places was, far and away, the most utilized geolocation check-in service. And that has big implications for every brand with a digital presence.

For marketers, then, the choice is clear. When looking to build out a location-based marketing strategy with a strong digital component, Facebook Places will yield the greatest success right now.

By leveraging your existing investment in social media, to promote your location-based touchpoints, you will also ensure that there is strong brand affinity and purchase intent with your geolocation initiatives.

When a marketing geolocation strategy starts with your existing Facebook Fans, it’s easy to build successful engagements with an incremental, test-and-learn approach. It also provides valuable insight into your social media community and drives additional value for your most connected and most important customers.

This is cross-posted on the White Horse blog – go there for all types of digital marketing goodness.

Recently, Downy fabric softener and Macy’s bedding department sponsored an event where comedian Mike Birbiglia slept in a Macy’s store window display for a week. People all over the world could watch “Mike in the Window” on Downy’s Facebook page, and see videos of him trying to sleep.